Fuel is about to get cheaper as Saudi Arabia floods the market

[pmclaine]

The markets have been propped up in such a fragile way that doesn't matter what pushes them over - once that Jenga tower starts to fall, gravity takes over at 9.8 m/s^2.

I agree that coronavirus itself isn't a huge deal. But it doesn't have to be anything big to expose the irrationality of the world economy. Here in the US alone, there is probably trillions in consumer debt (home/auto/student loans + revolving debt) that would go into default with a couple missed paycheck cycles. Businesses have been operating just as foolishly. The markets have been ignoring that while simultaneously making silly predictions about future growth, and those illusions just got ripped away. The fact that the markets didn't go on a big tear after last week's Fed rate cut was the indication that we're suddenly playing by different rules.

It's possible that this all blows over in a month or two, and that we'll be back to Dow 30k by summer. But man, I remember similar predictions in 2008, and the "rational optimists" got their faces ripped off by what followed.

Last time we had too big to fail.

Had we let the losers lose than opportunity would have been created in the vacuum.

Instead the losers were rewarded and the result was no correction just stagnation.

The markets were exposed as a fallacy. It neither punishes bad decision making nor rewards good decision making.

If this blip is allowed to run its course without undue interference it will pass.

Of course though politics is interfering.

As last time efforts are being made on the side of one political agenda.

 

[Gunfighter14e2]

Laughing at the amount of funny money an so call wealth that is about to vanish. The "How Much A Month, Look at Me An what I have Club" is about to learn a hard lesson. Unless you hold title to it you don't own it,...

 

[deersniper]

Glad I have 20k?

How much do you go through a year? I have a 6 too but need to set up the 10 I bought last time I missed the fuel dump

 

[Mr.BR]

Well, just to play Devils Advocate, one reason to support the oil industry would be to keep it viable while totally screwing countries who we don't like. Russia, Venezuela, Iran, these countries really hurt when oil drops. If we kept our industry afloat thru the dip, we would be ready to take advantage quickly when the price turned around. Personally, not a fan of supporting industry with my tax dollars. Just throwing out a reason why.

FED 'supported' the whole Shale boom , that even in best of times was not realy profitable , but as long a abundant cheap money is there investors threw that money down every rabid hole they could find. US Admin suported the market by taking Iran and Venezuela off the market .

Sauds tried to sink the shale before and inflicted plenty of pain on the industry, but now with all the financial bubbles ready to burst timing is perfect. Sauds trying to force Russians back to OPEC+ deal is unlikely to succede ,Russians have been preparing for years to weather the oil price drop ,US taking Venezuela and Iran of the market was a boon for them as well .

MBS now going for another purge and shakedown shows that pain might cause plenty of unrest in ISIS'R'US KSA .
''Saudi Arabia is under financial pressure. The government's 2020 budget was predicted to have a $50 billion deficit or 6.4% of the Saudi GDP. But that was based on an estimated crude oil price of $62-63 per barrel, and assumed a crude production at around 9.8 million barrels per day ''

Wonder how that investment into ARAMCO IPO is panning out.

https://wolfstreet.com/2020/01/22/t...ruptcies-defaulted-debt-and-worthless-shares/
https://www.worldoil.com/news/2019/...n-the-edge-of-profitability-at-current-prices

 

[goinghunting]

How much do you go through a year? I have a 6 too but need to set up the 10 I bought last time I missed the fuel dump

I think I've burned 18k or so the last couple years of off road Diesel, and another 8-10k licensed highway heavy duty trucks.

Have an old 7500 gal single wall and newer 12500 double wall.

These things burn it up pretty quick.

 

[pmclaine]

Fracking has shown it can weather ups and downs in the market.

The question is can the Presidency?

Stock market starting to hit circuit breakers this am.

 

[deersniper]

View attachment 7268919
I think I've burned 18k or so the last couple years of off road Diesel, and another 8-10k licensed highway heavy duty trucks.

Have an old 7500 gal single wall and newer 12500 double wall.

These things burn it up pretty quick.View attachment 7268919

Too much goes to the afterburner. Should have bought red and DEF. lol.

 

[pmclaine]

Timing.......I think the timing on this is off. Off to our benefit.

I don't see numbers indicating that deaths are going to be fast and furious.

We are coming into spring and shit like upper respiratory tract infections start to taper off. 70 degrees in New England today.

Dems are going to have to start putting pillows over the faces of corona virus people in order to raise the death count.

People are getting tired of the constant beating drum.

My town today has its first school closed. Ive had a respiratory infection for two days now.

Ill still be here next week all mended and people are going to be moving on to the next distraction.

This might have been more dangerous if it was a September/October issue.

Unsure how this is going to hold steam when travel season starts and the economy heats up for summer.

 

[Mr.BR]

Fracking has shown it can weather ups and downs in the market.

The question is can the Presidency?

Stock market starting to hit circuit breakers this am.

Fracking can weather as long as money can be thrown at a loss making bussines , folks have been selling bullshit for a long time.

''The U.S. shale oil and gas industry has lost more than a quarter trillion dollars since 2007, while being sold to investors as an economic boom, even at oil prices much lower than those of recent years. ''

''even during the height of today’s massive boom, much of the fracking industry was actually losing money.
one firm looked at the financial statements of the sixty largest publicly traded fracking companies. They found that from 2006 to 2014, the fracking firms had spent $80 billion more than they had received from selling oil and gas. Even when oil was at $100 a barrel, none of them generated excess cash flow—in fact, in 2014, when oil was at $100 for part of the year, the group burned through $20 billion.''


https://www.texasmonthly.com/podcas...&utm_campaign=Web+Social&utm_content=Boomtown
https://www.nakedcapitalism.com/2020/03/is-the-u-s-fracking-boom-based-on-fraud.html

 

[pmclaine]

One thing I note about my current respiratory infection.

Its "productive".

Coughing isn't so severe, certainly not a dry hacking cough that gives you massive headaches from creating pressure in your head.

From day one Ive been producing phlegm or what have you when I do cough. Usually don't get that "relief" until you are on the downside of the infection and starting to come out of it.

Nothing says my current infection is corona virus, I don't think it is, but usually when I'm sick its whatever is "going around".

With the limited testing going on I think the med people are just saying shit is corona virus as most of this shit is all related anyway.

 

[Mark1954]

I use E85 year around for a everyday fuel. The only time it doesn’t make sense is when the vehicle is going to sit idle for months. Ethanol has a poor shelf life but if your driving daily it works great and saves some money as well.

Do you see a difference in gas mileage when switching between E85, E10 or ethanol free gasoline? The heat of combustion of ethanol is much lower than conventional gasoline. I’m curious if the is a mileage impact in the real world.

 

[pmclaine]

Fracking can weather as long as money can be thrown at a loss making bussines , folks have been selling bullshit for a long time.

''The U.S. shale oil and gas industry has lost more than a quarter trillion dollars since 2007, while being sold to investors as an economic boom, even at oil prices much lower than those of recent years. ''
https://www.texasmonthly.com/podcas...&utm_campaign=Web+Social&utm_content=Boomtown
https://www.nakedcapitalism.com/2020/03/is-the-u-s-fracking-boom-based-on-fraud.html

Our fracking and support of helps us strategically while tactically hurting our enemies.

Is the fracking industry and energy independence during a time of unsettled domestic politics as well as unsettled world politics worth the cost of an aircraft carrier task force?

Which is more viable in war and strategically more beneficial?

 

[Codiekfx400]

Do you see a difference in gas mileage when switching between E85, E10 or ethanol free gasoline? The heat of combustion of ethanol is much lower than conventional gasoline. I’m curious if the is a mileage impact in the real world.

Yes there is a difference. I see a 20% reduction in fuel mileage going from 10% to 85% ethanol. Going from unleaded to 10% is not a noticeable difference.

 

[SilentStalkr]

So, we are time traveling back to 2015 again.
Yeehaw...(sarcasm).
Nice knowing you guys. Might not be able to buy internet or basic shit for that matter in a few months.

If your looking for a good deal on a house, atv, truck he’ll anything; come to Texas later this year and buy off all the out of work oilfield and pipeline people.

Piss on it, always thought it would be an adventure to go to Wyoming and work for Weatherby or some such outfit.

Do NOT, I repeat DO NOT, enter the gun industry for anything. It’s floundering as well. Unless you just want to do it for fun or something but you won’t have any job security unless you own you own gig. Big companies have been struggling for awhile, many are even laying people off. Surprisingly, Remington is actually hiring but that’s like rolling the dice big time as Big Green has had some trouble as well.

 

[Hound Dog]

Im more of the why kick the can down the road. Everyone in the industry is aware these companies are living on borrowed time. They borrowed money with no way to pay it back unless oil goes well above 100$ a barrel in some cases. I read a buyout that happened last week and to break even they need oil over 150$.

Unless there is some sort of nuclear event in the ME or a second long Arab spring we will never see 150 dollar a barrel oil again, and probably not even 100. Any finance guy that would approve a break even at 150 needs to committed to an insane asylum.

 

[wade2big]

Sun+solar panels+electric vehicles= screw the Saudis

That would screw the US economy.

 

[wade2big]

Laughing at the amount of funny money an so call wealth that is about to vanish. The "How Much A Month, Look at Me An what I have Club" is about to learn a hard lesson. Unless you hold title to it you don't own it,...

Even then it is taxed to no end my friend if it has any real value. You know that.

 

[Codiekfx400]

If foreign countries want to damn near give away their oil I say let them. We should be buying all they have at $25 to $30 a barrel.

 

[Mr.BR]

If foreign countries want to damn near give away their oil I say let them. We should be buying all they have at $25 to $30 a barrel.

If you haven't noticed , you are not far away from a 'bailout' , money will be thrown at the banks and funds that over played their hands with other peoples money. Buying cheap oil is not realy on anyones plate right now.

 

[Codiekfx400]

Well you gotta love the US government.

 

[deersniper]

Well you gotta love the US government.

Organized crime.

 

[atepointer]

If you havent noticed , you are not far away from a 'bailout' money will be thrown at the banks and funds that overplayed their hands other peoples money

Bank bail outs are not possible under Dodd-Frank provisions....you used it in quotes so not sure if you meant a true financial bail out. If you are a depositor at any of the institutions who are heavy lenders to oil and gas good luck! I do agree there is going to be a huge amount of attrition in the oil and gas industry b/c a liquidity crunch is coming. Way too many highly levered companies and for those who get their bond ratings lowered it will get ugly. Poorly timed maturities and resulting cash flow.....yikes.

 

[mdmp5]

I dont think I have EVER heard of a FUTURES market being shut down due to hitting a circuit breaker point...

This shit is IRRATIONAL...

Happens often in commodities, maybe a few times a year. Just doesn’t happen often in financial indices anymore. S&P and Dow Used to lock limit up every week back in 1999

 

[atepointer]

Laughing at the amount of funny money an so call wealth that is about to vanish. The "How Much A Month, Look at Me An what I have Club" is about to learn a hard lesson. Unless you hold title to it you don't own it,...

I watched this unfold right on my street post 08. 4 foreclosures on a street of 14 homes. One common theme was country club memberships, $$$ car leases parked in the driveways, fancy clothes etc. Living a highly levered lifestyle is never far from financial ruin. I hate seeing it b/c it's a self-fulfilling prophecy decade after decade.....have watched people I love run full steam into the pit.....then do it again.

 

[E. Bryant]

I use E85 year around for a everyday fuel. The only time it doesn’t make sense is when the vehicle is going to sit idle for months. Ethanol has a poor shelf life but if your driving daily it works great and saves some money as well.

The local price for E85 is about $2.05 - that's only 15% cheaper than E10, so it's not enough to offset the difference in fuel economy. Prices may very well be different in your AO and so maybe the math works better for you.

I like it simply because it is a great pump fuel for forced-induction engines. It's kinda awesome being able to run 25 degrees of total timing at 14 PSI with fuel that came from the local supermarket gas station.

 

[Gunfighter14e2]

I watched this unfold right on my street post 08. 4 foreclosures on a street of 14 homes. One common theme was country club memberships, $$$ car leases parked in the driveways, fancy clothes etc. Living a highly levered lifestyle is never far from financial ruin. I hate seeing it b/c it's a self-fulfilling prophecy decade after decade.....have watched people I love run full steam into the pit.....then do it again.

View attachment 7269113

Yep, lots of people think having the address, rides an other toys are cool, an that is fine. However when it all goes to shit don't come running an what, what I have worked for, to bail your stupid ass out, like they did in 08. No way in hell would I ever do a 401K, that I could not stop in 15 seconds if I had it to do over again. Wall street, all lenders an Uncle are nothing but a pack of thief's who can not make it on their own w/o tax money bailing their ass out over an over again. When they started jumping out of the windows in 29 my Grandfather said he an other smiled for weeks on end. Even though I lost a shit ton of money in 08 I laughed as well knowing some of them could not even feed their selfs w/o their Gucci job that quickly went tits back then.

 

[armorpl8chikn]

Solve the over population problem and all other problems that stem from that.

Here we go again.
So you are a survivor huh?
What makes you think you won't be among the dead when the population gets "adjusted"?

 

[E. Bryant]

Last time we had too big to fail.

Had we let the losers lose than opportunity would have been created in the vacuum.

Instead the losers were rewarded and the result was no correction just stagnation.

The markets were exposed as a fallacy. It neither punishes bad decision making nor rewards good decision making.

If this blip is allowed to run its course without undue interference it will pass.

Of course though politics is interfering.

As last time efforts are being made on the side of one political agenda.

Agreed wholeheartedly with the thrust of your comments. I was in the auto industry when the last crash hit. It would have sucked to see some of those companies go under, but the ones that survived might have be better-equipped to weather the coming storm. Unfortunately, I suspect we will soon find that we have built even more fragility into the system than existed before the last crash.

I'm particularly interested in seeing how many of the "stress tested" banks eventually require a bailout.

 

[blbennett1288]

My companies stock took a dump today. Was in the mid 20’s now down to mid teens. Down from high 40’s to low 50’s this time last year.

Just turn that entire place to glass man.
Might be time to update my resume and find something outside O&G

 

[atepointer]

My companies stock took a dump today. Was in the mid 20’s now down to mid teens. Down from high 40’s to low 50’s this time last year.

Just turn that entire place to glass man.
Might be time to update my resume and find something outside O&G

Upstream, midstream or downstream?

 

[blbennett1288]

Upstream, midstream or downstream?

Upstream w/ Schlumberger

 

[Snuby642]

WTI 31$ a barrel few minutes ago.

 

[Mr.BR]

Making some popcorn waiting for TSLA stock to crash .

No market is not droping due to KSA vs Russia oil hose fight , its just too many bubbles inflated by FED that need to pop , Covid19 is just a catalyst.

 

[Arc Light]

This came at a great time for me. I need to fill my 500 gallon propane tank and am going to wait to see how low prices will go.

If a bunch of Wall Street speculators lose their ass on this, no one will be losing any sleep over it. Fuck them. I never thought an essential commodity like gasoline should be able to be bought and traded by people never intending to take delivery of the item. A lot of people were hurting bad years ago when prices were $5 a gallon due to these parasites.

 

[Mr.BR]

Wall Street plays with your 401k not their own money that is the whole point of their grift.

 

[Darkside-Six]

This is the first time the stop losses on the market have been triggered since they implemented them in 2010 after the flash crash the market had.
There’s a lot of blue light specials on most of the big name blue chip stocks of you have some money to load up your IRA’s.

 

[MarinePMI]

All the political bullshit aside, let's face it; we're watching the world economy begin to change from being driven by oil/petroleum. What that new dominant market driver will be is unclear, but oil is ending it's reign of controlling world markets. Even the Saudi"s know it (they have been frantically trying to move their economy away from oil for years now).

Just like when the Venetians cornered the world market on salt in the 1500's, the Saudi's have enjoyed a bountiful time; but everything eventually comes to an end when technology mitigates a strangle hold that someone holds on the world's economies...kind of like when the Chinese figured out how to make brine wells for cheap, inexpensive salt.

Tokamak, pinch, Z-pinch; they're all coming down the pike...

 

[pmclaine]

All the political bullshit aside, let's face it; we're watching the world economy begin to change from being driven by oil/petroleum. What that new dominant market driver will be is unclear, but oil is ending it's reign of controlling world markets. Even the Saudi"s know it (they have been frantically trying to move their economy away from oil for years now).

Just like when the Venetians cornered the world market on salt in the 1500's, the Saudi's have enjoyed a bountiful time; but everything eventually comes to an end when technology mitigates a strangle hold that someone holds on the world's economies...kind of like when the Chinese figured out how to make brine wells for cheap, inexpensive salt.

Tokamak, pinch, Z-pinch; they're all coming down the pike...

Fine by me.

Just remains to be seen will the have nots decide before they get left behind that they need to launch their conventional nukes in order to ensure their place in the world.

Seeing some countries control such a technology and becoming independent would be threatening perhaps.

Just hope enough hasn't been given away or stolen from places like MIT that my hunch we are ahead in this technology is not a false assumption.

 

[MarinePMI]

Fine by me.

Just remains to be seen will the have nots decide before they get left behind that they need to launch their conventional nukes in order to ensure their place in the world.

Seeing some countries control such a technology and becoming independent would be threatening perhaps.

Just hope enough hasn't been given away or stolen from places like MIT that my hunch we are ahead in this technology is not a false assumption.

We have a peer competitor, but don't we always? Either way, it's going to be interesting...

My bet is on REE being the next big market driver (as well as forcing space exploration). There's only so much platinum and irridium on this mud ball...

 

[pmclaine]

We have a peer competitor, but don't we always? Either way, it's going to be interesting...

My bet is on REE being the next big market driver (as well as forcing space exploration). There's only so much platinum and irridium on this mud ball...

You took the advanced class and be losing me some with your quick turns.

Depends on who the peer is.

Seems the ones we consider to be friendly democracies are too busy committing suicide to use this in a way to benefit or cooperate with us.

One other peer has its own internal problems and chooses to reinforce its Kreml for the time being.

But the real enemy, the real threat is given aid and comfort by half the voting electorate and the other half has the arrogance to think they will control them as long as the profits keep coming.

 

[MarinePMI]

LOL, sorry, I've been thinking about this sort of thing for quite some time now (what my boss tells me... "You're paid to do this; think critically about what's next!").

I think Rare Earth Elements will likely be one of the main drivers of world economies, when petroleum is relegated to a standard commodity consumable.

As to peer competitor...I think you nailed it.

 

[Rthur]

We have a peer competitor, but don't we always? Either way, it's going to be interesting...

My bet is on REE being the next big market driver (as well as forcing space exploration). There's only so much platinum and irridium on this mud ball...

Could be Helium 3.

R

 

[MarinePMI]

Could be Helium 3.

R

Meh, could be. I think hydrogen will suffice though, assuming deuterium and tritium waste can be resolved/handled... There's people with a lot bigger brains than mine looking at this, so I would assume they will figure out a solution. Someone recently scrawled some of the math on a white board, explaining some of it to me, but it just made my head hurt (being the knuckle dragger that I am).

 

[Rthur]

Meh, could be. I think hydrogen will suffice though, assuming deuterium and tritium waste can be resolved/handled... There's people with a lot bigger brains than mine looking at this, so I would assume they will figure out a solution. Someone recently scrawled some of the math on a white board, explaining some of it to me, but it just made my head hurt (being the knuckle dragger that I am).

MIT had some interesting results with above in 17.
When I was younger I thought we'd be permanent lunar by now.
I guess I over estimated the commitment.

R

 

[MarinePMI]

MIT had some interesting results with above in 17.
When I was younger I thought we'd be permanent lunar by now.
I guess I over estimated the commitment.

R

Yes, they did. As I understand it though, huge advances have been made across many different methods since then. Ingenious (at an atomic level) is an understatement to some of the stuff they're playing with today. I just wonder what will happen when the genie gets out of the bottle. That's when I sit back, and as I watch the stock market plummet over oil prices, wonder if that's how (or when) they'll unstopper the bottle. I don't think we're quite there yet, but definitely within our lifetime, I'd wager.

 

[pmclaine]

LOL, sorry, I've been thinking about this sort of thing for quite some time now (what my boss tells me... "You're paid to do this; think critically about what's next!").

I think Rare Earth Elements will likely be one of the main drivers of world economies, when petroleum is relegated to a standard commodity consumable.

As to peer competitor...I think you nailed it.

Could be a better opening to relationships with Russia assuming we were willing to put our KSA "allies" in the hole they belong in.

Shame the dems are doing their best to muddy that relationship

 

[Rthur]

Yes, they did. As I understand it though, huge advances have been made across many different methods since then. Ingenious (at an atomic level) is an understatement to some of the stuff they're playing with today. I just wonder what will happen when the genie gets out of the bottle. That's when I sit back, and as I watch the stock market plummet over oil prices, wonder if that's how (or when) they'll unstopper the bottle. I don't think we're quite there yet, but definitely within our lifetime, I'd wager.

If you have any reference links about said I've always enjoyed reading on this subject.
I think they/them that really run the money institutions already have looked past
petro.
How and when this tech will be 'released" will, I'm sure, be under the same control.

R

 

[pmclaine]

If you have any reference links about said I've always enjoyed reading on this subject.
I think they/them that really run the money institutions already have looked past
petro.
How and when this tech will be 'released" will, I'm sure, be under the same control.

R

Ill keep an eye on Bretton Woods to see if they are having any meetings to best discuss milking the slaves.

 

[atepointer]

Upstream w/ Schlumberger

That's a tough space to be in right now. I gotta believe SA will blink first they need ~ $85/barrel to meet their debt service and Russia about $45. Plus there are a ton of powerful Saudis underwater on their ARAMCO investment. Midstream has been getting hammered for a year too even pipeline toll booths getting hammered with huge free cash flow and dividend coverage still obliterated today. Hang in there.

 

[jinxx4ever]

Agreed wholeheartedly with the thrust of your comments. I was in the auto industry when the last crash hit. It would have sucked to see some of those companies go under, but the ones that survived might have be better-equipped to weather the coming storm. Unfortunately, I suspect we will soon find that we have built even more fragility into the system than existed before the last crash.

I'm particularly interested in seeing how many of the "stress tested" banks eventually require a bailout.

none, they have access to ur deposts now, u will be bailing them out with whatever u have in the bank